As the Brexit dust clouds settled over the industry this morning, an inquest began into whether industry leaders did enough to make the case against a leave vote.
Despite huge swathes of the industry on both the retailer and supplier side being in favour of remain, both the FDF and the BRC, the two biggest industry bodies, decided to sit on the fence.
The FDF had looked poised to run a proactive anti-Brexit campaign, especially after bringing in a massive pro-European, Ian Wright, as director general last year.
However, the organisation’s leadership found its intentions blunted by a momentous vote by its executive committee, which despite a large majority supporting the position refused to allow Wright and co a remit to publicly campaign.
Today Wright was one of the first to react to the leave vote.
“In March we released the results of a poll of our members, which showed 70% support for Britain to remain in the EU,” he said. “It’s inevitable in the light of those results that the majority of FDF members will regard this as a disappointing result for the food and drink industry.
“Now FDF will work on behalf of our members and all those across our industry to find a way through this very challenging period that we face.”
Yet the March move, which included the FDF launching a website setting out the economic arguments for as well as against Brexit, was tame compared with what some wanted.
That crucial meeting of its executive committee saw the bosses of leading companies clash over whether a Brexit would be good for the industry, with one source saying 15 of the 25 companies at the meeting that day were “absolutely in the remain camp”.
Yet at least three other voices were openly in favour of Brexit and a conclusion was reached that it would not be a “good use of resources” for the FDF to spearhead such a campaign.
Wright, who had previously repeatedly spoken out against the danger of Brexit and was a leading ally of arch-European Nick Clegg as a key player in the Liberal Democrats, was forced to tone down the rhetoric and told The Grocer he had no intention of “doing a John Longworth”, the director general of the British Chambers of Commerce, who was ousted after going “off piste” and speaking out in favour of Britain leaving the EU.
So despite the bosses of Unilever, Diageo, Ocado, Nordic Bakery, Chivas Brothers, Greene King, SAB Miller and Wyke Farms being among those who wrote a letter to The Times calling for the UK to ‘stay in’ after Cameron set a date for the EU referendum, the campaign could not be spearheaded by the main trade body.
Today as thoughts turned to the repercussions in the industry of what one source described as the “shock and amazement” of the vote, one of those signatories, Rich Clothier, MD of Wyke Farms, accused the industry of failing to stand up for its beliefs and of “hanging David Cameron out to dry.”
“I said back in March that I feared the industry was going to sleepwalk into Brexit and my worst fears have been realised,” he said. “I don’t think the food sector was prominent enough. Far too many people sat on the fence and now we’ve ended up with something that the vast majority of us didn’t want.”
Clothier said organisations and individual suppliers and retailers should have been far more vocal.
“The CBI was vocal and I credit them for that. The NFU also took a stand but too many others stayed quiet.
“I think that applies to organisations like the FDF but also our retailers, especially those who operate globally and across Europe, who took the safe option because they were too worried about preserving their share and didn’t want to risk upsetting their customers.
“As a sector as a whole we should have campaigned far more vehemently and I think now we have to take a long hard look at ourselves.”
Clothier said he feared the industry would now find itself “at the back of the queue” when it came to renegotiating trade deals with Europe and the US, adding it “only had itself to blame.”
“We left it to people like David Cameron to do all the heavy lifting and in doing so we basically hung him out to dry,” he said.
Another senior source admitted the industry had not treated the threat of Brexit seriously enough.
“I think it’s probably true that we were all just a bit complacent,” he said. “There was an expectation that good sense would prevail. It was unthinkable that we would end up where we are today.”
The BRC, meanwhile, had long ago said it planned to remain neutral in the debate, despite leading retailers including M&S and Asda, as well as hugely influential former retail bosses Sir Terry Leahy, the Tesco legend, the previous boss of Sainsbury’s Justin King, and Marc Bolland, former M&S chief, among those urging for a vote to stay in Europe.
They were joined by former BRC chair Sir Ian Cheshire in writing an article in the Mail on Sunday that warned of a disastrous impact on inflation of retail food prices in the event of Brexit.
Yet the main intervention of the current BRC leadership was to write letters to both sides in the debate, setting out the pros and cons of a vote either way, a move one source describes as “incredibly weak”.
In fact, by far the hardest words in the letters, written by BRC chief executive Helen Dickinson, were aimed at Britain Stronger in Europe campaign director, Will Straw, saying that the EU was failing to provide British retailers with a more open trading environment and swamping businesses with red tape.
“We believe that the impetus in the EU towards a more open trading environment is waning,” she said.
“In particular, we see slow progress being made in the EU’s trade negotiations with key partners including the US and Japan.
“Our concern for the future is that within the EU our trading relations with other countries will become more not less restricted, making it more difficult for retailers to offer a full range of products at the best prices to our customers.”
Although Dickinson told Matthew Elliott, chief executive of Vote Leave Westminster, that businesses would struggle to cope without the single market and warned thousands of farms risked becoming unviable, she made no mention of soaring retail prices, unlike the former retail leaders.
Today, though, Dickinson did turn to the subject.
“Keeping the cost of goods down for consumers and providing certainty for businesses must be at the heart of the government’s plans for life outside the EU,” she said. “Now that a decision has been made to leave, it is important the Government moves quickly to explain the process of disengagement from the EU. Without clarity, retailers, other businesses and hence the economy will suffer from a prolonged period of uncertainty.”
The question is whether such warnings should have been heard much earlier.
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